Ripple has completed its commitment to buy $50 million worth of equity in money remittance service MoneyGram.
In a press release shared with Coin Rivet, MoneyGram announced that Ripple had successfully acquired a further $20 million worth of equity in the NASDAQ-listed company having already invested $30 million earlier this year.
Ripple purchased newly created equity at a price of $4.10 per share, which is significantly higher than MoneyGram’s current market price of around $3.00. However, the extra capital will be used to develop ‘On-Demand Liquidity’ (ODL) solutions.
Ripple’s ODL technology uses XRP digital assets to send money globally and instantly for low fees.
Chairman and CEO of MoneyGram Alex Holmes said of the investment:
“Our partnership with Ripple is transformative for both the traditional money transfer and digital asset industries – for the first time ever, we’re settling currencies in seconds. This initial success encourages us to expedite expanding our use of On-Demand Liquidity.”
Holmes tweeted his support for ODL technology after discussions with Ripple at the recent SWELL conference.
I spoke with @bgarlinghouse at #SwellbyRipple about the @MoneyGram partnership with @Ripple and what's next for the money transfer industry. Using #ODL will strengthen and streamline the settlement engine that lets our customers send money in over 200 countries and territories. https://t.co/tFnq2S3NAJ
— Alex Holmes (@walexholmes) November 8, 2019
Describing the technology as the next stage of the international remittance industry, Holmes said he hopes that ODL will allow MoneyGram to “strengthen and streamline” its settlement processes.
At present, MoneyGram is moving 10% of its Mexican peso foreign exchange using Ripple’s ODL technology, and is now working on four additional currency corridors.
Despite the investment, MoneyGram’s stock price fell by 2.2% today, possibly as the news was already priced in following the original investment announcement.
Ripple’s original $30 million investment in MoneyGram was announced by CEO Brad Garlinghouse in June this year.
As reported by Coin Rivet in August, MoneyGram’s stock price rose 168% on the news. Ripple announced at the time that it would be looking to invest a further $20 million in MoneyGram within the next two years.
However, Ripple has fulfilled its commitment within the same financial year, and now owns 9.95% of MoneyGram’s outstanding common stock.
Ripple has been moving from strength to strength this year, announcing at a recent SWELL conference that its next step is to attract more banks to its platform.
Earlier this month, it was also announced that SBI Ripple Asia, a Tokyo-based entity using Ripple’s blockchain technology, launched the first-ever blockchain remittance service between Japan and Vietnam, with settlement times of just a few minutes.
Ripple is also working with SBI Holdings to provide a Ripple-powered ‘MoneyTap’ app, which lets users make payments using just a QR code or phone number.